The role of exchange rate on hotelier’s pricing decision and business performance: the case of Switzerland, a small open economy

Abstract

This study focuses on the role of the exchange rate on hotelier’s pricing decision and business performance. This study explores the way hospitality industry practitioners react to exchange rate fluctuations and monetary policy interventions on the FOREX market. By analyzing monthly performance data of hotels in Switzerland between January 2000 and April 2021, this study finds the presence of two structural breaks in the economy, due, respectively, to the central bank’s intervention on the exchange rate market and to the COVID 19. The findings of this study suggest that hoteliers pay close attention to fluctuations in the exchange rate as well as to monetary policies. These findings should raise individual hoteliers’ awareness about their competitors’ behavior and help them better define their strategic decisions in terms of pricing.

Customer Satisfaction and Repurchase Intentions in Hotels During the Exchange Rate Change in Egypt: A Comparative Study Based on Demographic and Tripographic Attributes

“…Hence, the exchange rate fluctuations at the time of booking accommodation can impact hotel room demand, causing variations in demand patterns across different countries (Aalen et al, 2019). Additionally, Blengini and Heo (2023) explored the impact of exchange rate fluctuations on international tourist demand and mentioned that these fluctuations can affect destination choice, length of stay, and expenditure. Exchange rate fluctuations also impact inbound tourists, with different types of tourists responding differently to such fluctuations (Shi, Gong, Wang & Nikolova, 2023).…”